Massive Gas Spill Leads to |Emergency Declarations

(CN) - Georgia and Alabama have declared states of emergency after a massive spill led to the closure of a crucial pipeline that carries millions of gallons gasoline to the eastern United States every day.

The pipeline, which runs from Houston to New York, was closed after of spill of an estimated 250,000 gallons of gasoline was discovered in a heavily-wooded portion of Shelby County, Ala.

Colonial Pipeline, which operates the pipeline, said in a statement that the cause of the leak has yet to be determined.

The company also said it doesn't expect to fully reopen the pipeline until sometime next week. It ordinarily provides 1.3 million barrels per day to East Coast.

And that means consumers in the Southeast and in the eastern half of the country may soon see higher gas prices at the pump, and in some cases, find their neighborhood filling stations temporarily have no gas to sell.

In a statement, Colonial Pipeline said, "Based on current projections and consultations with industry partners, parts of Georgia, Alabama, Tennessee, North Carolina and South Carolina will be the first markets to be impacted by any potential disruption in supply."

The company went on to say that it has briefed officials in these states so that they can plan accordingly.

In response, Alabama Gov. Robert Bentley on Thursday issued at executive order declaring a state of emergency

The order will temporarily allow truck drivers delivering fuel or engaged in the pipeline repair to work longer shifts and exceed maximum hour limits established by the U.S. Transportation Department and its Federal Motor Carrier Safety Administration to prevent gasoline outages.

It also expressly prohibits price-gouging at the pump.

Bentley said the state of emergency will be in effect for the next 30 days, unless he decides to end it earlier.

Georgia Gov. Nathan Deal issued a similar executive order for his state on Tuesday.

In afternoon trading on Friday, the prices on futures contracts for wholesale gasoline rose about 2 percent to $1.46 a gallon, after rising 5 percent on Thursday.

Tom Kloza, an energy analyst with the Oil Price Information Service, said some stations in the Southeast could run short on supply and boost their prices by 20 or 30 cents a gallon.

"The Colonial pipeline is the metaphorical aorta for the supply the most populated regions of the country, and you've lost 10 days of blood flow," Kloza said.

The good news, he added, is that the disruption comes at a time when gasoline prices are down sharply from a couple years ago.

U.S. Environmental Protection Agency personnel at the site of the spill said it does not pose a danger to residents in the area, and that it is unlikely to enter the nearby Cahaba River, which is home to a number of endangered species and other sensitive wildlife.

Colonial said it has begun transporting gasoline through a second pipeline it operates in the area, and that it should get fuel at least as far as Western Alabama.

The pipeline, known as Line 2, is ordinarily used to carry jet fuel, diesel fuel and home heating oil.

Despite these measures, the spill and resultant closure has set off an industry-wide scramble as suppliers seek alternative ways to transport gasoline to the East Coast.

The Associated Press contributed to this report.

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